Social care cuts are creating a two-tier care home market which is driving investment into wealthier areas with more self-funders, at the expense of homes used by council-funded clients, warn providers.

92% of providers felt that low council fees were creating a two-tier market between self-funders and council-funded residents.

94% of providers report that council-funded residents are older, have higher levels of need and survive for shorter periods than they used to, an apparent outcome of rising eligibility thresholds and the focus on home-based care.

98% felt they were not funded sufficiently by councils to meet public expectations of the quality of care.

ECCA chief executive Martin Green said the results confirmed that self-funders were having to cross-subsidise council-funded residents. “The most worrying aspect of the survey is that many care providers believe that we are creating a two tier market, and this cannot be right in a society that should be advocating for fairness and equality of access to care services.”

The Local Government Association said the findings reflected long-term under-funding, rising costs of care and an ageing population, coupled with the cuts imposed on councils under the government’s 2011-15 deficit reduction plan.

Labour’s shadow minister for care and older people, Liz Kendall, said councils were being “forced to pass on [government cuts] to care providers”, citing figures showing more than £1bn has been removed from council social care budgets for older people since the coalition came to power in 2010.

She urged government to introduce legislation before 2015 to reform social care funding. However, despite commissioning the Dilnot commission report into funding reform, which reported last year, the government is unlikely to consider the future of social care funding until the next spending review, expected in 2013.

It is due to publish a White Paper and draft bill on social care reform shortly, but neither is likely to feature funding changes; instead it will produce a progress report on funding reform at the same time.

In response to the survey, a Department of Health spokesperson said: “The government has provided enough for councils to maintain the current levels of access and eligibility for care home residents. Ultimately the amount of money and where councils allocate their funding on social care is decided by them.”

Our website uses cookies, which are small text files that are widely used in order to make websites work more effectively. To continue using our website and consent to the use of cookies, click click 'Continue'. Find out more.